Market Trends

Global trade volumes in 2017 stood at a staggering US$17 trillion. In addition to this, world commercial services exports accounted for another US$5.25 trillion. All these transactions involve the exchange of one currency for another. Consequently, banks and corporations enter into a large volume of foreign exchange trades.

This has led to the development of a huge forex market. According to a recent report, foreign exchange trades of a volume of US$3 trillion take place every day.

Forex trading offers tremendous advantages for businesses as well as for retail investors. The minute-by-minute fluctuations in foreign currency rates provide individuals with many opportunities to participate in the forex market.

Forex trading offers benefits for businesses as well. They get an opportunity to hedge their income in foreign currencies. This ensures that the effect of currency swings on their profitability is minimised.

Let’s understand how changes in the relative value of the U.S. dollar to the Singapore dollar can affect businesses and individual investors.

Teyu Che Chern, Phillip Futures’ CEO, has held a steady hand over the Singapore-based futures brokerage firm for the last 12 years, despite the changing landscape in the futures and forex trading market, and amid the ups and downs in the overall marketplace.

ZUU online met with Teyu at their office in Raffles City to learn how the company has changed in these last 12 years, and how he has managed it all.

A continuous learning process

“I always encourage the young ones to learn new things,” Teyu told ZUU online. “When time is on your side, keep an open mind. Learn everything, whether it’s a new product, a different process, or even a different platform. Take on manual tasks, operational work, risk management work, so you learn the different parts of the business.”

According to a research conducted by JP Morgan, 61% of institutional traders are extremely or somewhat likely to use a mobile trading app in 2018, up from 31% the previous year. For retail or individual traders, mobile trading offers the pure ease of being able to trade anytime and anywhere. Simply put, being away from your desk may mean that you miss the chance to make a profitable trade.

Mobile trading platforms have often been discounted by professional and experienced traders for their desktop counterparts, due to their lack of relevant and essential charts, indicators, and speed of price updates for traders’ quick investing needs.

With the speed of news flow, the improved functionality of mobile phones with larger screens, and ever-increasing mobile internet speeds, these issues are becoming a thing of the past.

In fact mobile trading platforms have become an increasingly viable option for fast execution among forex traders.

Take for instance the MetaTrader 5 mobile trading app, which is currently supported in Singapore through Phillip Futures. The MT5 mobile app offers multibank liquidity feed an extensive suite of orders types, customisable charts with quick switches between different instruments, over 30 technical indicators, 24 analytical objects, 9 time frames and 3 types of charts display. The app also keeps traders in touch with the pulse of the market with newsfeed streamed live from FXStreet, a well renowned news provider in the industry.

Oil prices seem to have a life of their own. Two and a half years ago, oil was trading at US$26 a barrel. This price was simply unsustainable for many oil exporting countries. In November 2016, OPEC and Russia, a major oil exporter that is not part of the 14-nation oil cartel, cobbled together an agreement to restrict oil production.

Their strategy seems to have worked, but only too well. Prices have risen and are currently at about US$76 for Brent crude and US$66 for West Texas Intermediate. While this is good for Russia, Saudi Arabia, and the other OPEC members, it is putting a strain on the economies of the oil-importing nations.

Sharpen your trading skills

The promotion involves opening a demo account. This will allow you to trade without actually committing any funds. But the Phillip Futures MT5 Spot Trading Challenge 2018 is much more than just a demo account.

Most traders would have experienced this scenario, the market is going in your favour and you decide to move either your stop loss, profit target or even add on to your existing position. The result, the market turns against you and you make a larger loss than you previously planned for. You have just made the most fundamental trading mistake.

It is a common occurence when in the heat of the moment; traders make decisions which they regretted later. This highlights the importance of trade management and having a trade plan. Without which, trading could be akin to just a toss of the dice.

Forex trading is one way of deploying your investible resources. An inexperienced trader can find it difficult to understand how the market functions.

However, by using the tools that are available to you, it is quite possible to come to grips with the market and start making profitable trades.

There are several techniques that you can use to help you to decide about the direction that the market is likely to take.

One key tool that can help your trading activity is the intelligent use of depth of market data.

What exactly is depth of market and how can you use it? In forex trading, depth of market refers to the liquidity available to efficiently getting the investors’ orders done with minimum slippage.

Depth of market data provide you with information liquidity at different prices. An observant investor would be able to decipher the sentiment of the makers, who are largely made up of banks and institutions.

If used correctly, this wealth of intelligence can give you a tremendous advantage. It can help to take the guesswork out of a trade and allow you to take a position based on the real-time information present before you on your computer screen.

Consequently, you will be able to trade with a greater degree of confidence and increase your chances of entering into winning trades.